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If you received a ticket for driving faster than the posted speed limit, would that change your driving behavior in the future?

According to assistant OSHA administrator Jordan Barab, penalties can result in significant change. Speaking at the NIOSH-sponsored National Occupational Research Agenda Symposium on July 13, Barab recounted how a “fairly large” traffic ticket he once received changed his driving behavior. He cited his experience as an example of how OSHA’s enforcement actions can lead to positive changes among employers, and argued for greater statutory limits to the fines OSHA can impose.

“I believe … enforcement has a very important role in changing the behavior of employers who would otherwise be cutting corners on safety and health,” he said. “But if you look at the literature, there’s been shockingly little research done on the general effectiveness of enforcement, things like the size of fines.”

No clear answer exists to perhaps one of the most pointed questions in the occupational safety and health community: Does OSHA enforcement – and penalties – provide an effective incentive to create safer workplaces?

Limited research

“I think he’s quite right that there isn’t any data to support his position. In fact, the data seems to indicate otherwise,” Gabrielle Sigel said of Barab. “The [injury, illness and fatality] numbers have come down – and have come down fairly significantly – over the years, while statutory penalties have not gone up.”

Sigel, a Chicago attorney with Jenner & Block LLP and founding member of the firm’s Environmental and Workplace Health and Safety Law Practice, said the decline of injuries, illnesses and fatalities shows the Occupational Safety and Health Act has been effective in creating a safer work environment. However, she does not believe penalties are the driver.

Although only a small amount of research exists on the topic, a few studies seems to indicate enforcement and the issuance of penalties can have a positive effect on workplace safety.

A study of workers’ compensation claims between 1999 and 2008 by the Washington State Department of Labor and Industries’ Safety and Health Assessment and Research for Prevention Program found a decrease in claims at locations where an inspection had occurred.

Another study, published in the National Safety Council’s Journal of Safety Research (Vol. 41, No. 4), found that OSHA inspections with penalties led to reduced injury and illness rates.

“What we’ve found is there is significant reductions in injuries following an inspection that imposes a penalty, but not the same sort of reductions for inspections that didn’t impose penalties,” said Wayne Gray, study author and a professor of economics at Clark University in Worcester, MA.

Conducted by Santa Monica, CA-based RAND Corp., the study reinforced conclusions from a handful of similar, previously published studies. Even so, Gray said, OSHA’s impact on injuries and illnesses is not receiving much attention from researchers, and the available data is complicated.

It is difficult to measure how the threat of a penalty will affect an employer. Gray said these effects are trickier to measure because researchers are dealing in the hypothetical and, considering the sheer number of workplaces versus the relatively small OSHA inspection force, many firms may never be inspected.

According to Gray, the “general deterrence” of a possible OSHA fine could inspire some companies to comply with regulations. “The existence of some enforcement does tend to reinforce people’s decision to comply with regulations,” he said.

Exploring the drivers

Several other factors are leading to safer workplaces, including more sophisticated workers and employers, according to Sigel. “Employers who are concerned about the safety and health of their employees – which is the vast amount of employers – are not doing so out of concern about penalties,” she said.

The concerns facing employers, Sigel said, involve more than compliance. They include answering to their employees and ensuring their safety, answering to their shareholders or a bottom line, and answering to their own conscience.

Sigel said clients have asked her for help with compliance, but not out of fear of being inspected. Employers want to learn how a regulation works, what it means, how to comply with it at their workplace, and how to talk to employees about it, she said.

On some level, OSHA enforcement and penalties do provide an incentive, Sigel noted, particularly to those employers who have received citations with penalties before. “Does it make a difference? Yes,” she said. “Is it the primary driver? No.”

But for Bethany, CT-based consultant and former OSHA compliance officer Rick Kaletsky, the declining numbers and rates of incidents seem to indicate OSHA plays a role in providing an incentive for employers.

“There truly are less injuries and illnesses and less fatalities. So the question is, ‘Why has it gotten better?’” Kaletsky said. “Forget what the Libertarians say; is there a reason to have law enforcement? I’m sorry, but it’s necessary. When [OSHA] took over 40 years ago, it was needed.”

Kaletsky suggested three separate levels on which OSHA enforcement provides incentives to employers:

The penalty itself, which Kaletsky said employers do not want to have to pay.

Repeat citations, where an employer is cited with a penalty for having the same violation for which he or she was previously cited. These can be more expensive than the initial penalty.

Loss of future jobs. This is harder to quantify, but a company – particularly a contract company (such as those in construction) – with a history of OSHA violations and penalties could start losing jobs because of it.

The last level, on which a company starts losing money due to the lack of jobs it receives based on its history, can be the most costly, Kaletsky said. “I think more and more, there’s an incentive,” he said.

“Certainly the threat of losing your competitive advantage would have a greater incentive than the fear of a small OSHA penalty, but it’s kind of hard to separate them,” said Apex, NC-based consultant Tom Cecich. Cecich has worked in the environmental, health and safety field for multiple large companies over the past 30 years.

A relatively minor citation for a hazard at one worksite can quickly be abated. The problem, Cecich said, is that having one minor citation or violation on a company’s record can set up a willful citation down the line if it happens again.

Once a company has a history of a willful citation, it creates a stigma that can have a major effect, Barab told the NORA crowd. Many government contracts – from the municipal level to the federal level – are out of reach for employers with a history of willful citations, which in turn makes the threat of one a powerful incentive.

“They don’t care how much they have to pay; they want to get rid of that willful citation,” Barab said. “And what that communicates to us is that this is an effective tool.”

Cecich said the real incentive is to keep employees safe on the job. Although a company might look at a contractor’s violation history, it primarily would want to see injury and illness rates to compare and contrast with competitors. “I think the bottom line, from my experience, wasn’t so much how many violations they had, but how many people are getting hurt,” he said.

Compliance and safety

Tightly centered on the debate of OSHA’s influence in creating a safer work environment through its enforcement is compliance, which for some safety and health professionals is a separate issue from safety.

The relationship between compliance and workplace safety is complex, Sigel said. Compliance does not necessarily mean employees are in a safe and healthy work environment. As an example, she pointed to OSHA recordkeeping rules and the confined space standards, and said complying with the former does not lead to a safer workplace as directly as compliance with the latter.

Conversely, Kaletsky warned that creating a safer workplace does not translate into completely escaping OSHA. A business can still be targeted as part of an emphasis program or other random inspection, such as from an employee complaint.

But in Cecich’s experience, no executive ever asked what had to be done to avoid an OSHA penalty. Their concerns, he said, were based on what needed to be done to create a safe work environment. To achieve that, employers must go further than the basic compliance level OSHA creates.

Gray’s research suggests that companies are aware of that distinction, and those looking to improve safety go beyond compliance. His study found that companies receiving a citation will target the deficiencies that were cited for improvements, and also will branch out to other areas that were not cited to improve safety.

For example, fined companies’ general injuries and illnesses will decline following a penalty – not simply injuries related to the cited hazard. “My sense of what is happening is that the response to an inspection with penalties is not really narrowly focused,” Gray said.

This backs up the experiences Kaletsky has had with employers who make safety improvements beyond the legal requirements after an OSHA inspection. Some companies who have experienced OSHA enforcement begin looking for hazards to fix – not simply violations.

“There is a momentum gathered by having your head channeled properly” by OSHA, he said.

Size matters

Enforcement plays a heavier role as an incentive for smaller or midsized companies, according to Apex, NC-based consultant Tom Cecich. “A $7,000 penalty for a 300-person company is a lot more significant than a $7,000 penalty for a Fortune 100 company,” Cecich said.

Bethany, CT-based consultant and former OSHA compliance officer Rick Kaletsky echoed Cecich’s comments and said a large company can afford to deal with penalties and fines, and might be more concerned about the negative public perception attached with OSHA violations. Speaking at the National Occupational Research Agenda Symposium in July, assistant OSHA administrator Jordan Barab said OSHA press releases publicizing high penalties against companies have led to other employers seeking help from consultants and attorneys to avoid similar “public shaming.”

Kaletsky said OSHA press releases on enforcement actions could prompt some companies to make occupational safety and health changes, but such an incentive is probably limited to larger companies that are seeking to spare themselves embarrassment.

For smaller companies, however, the monetary amount of penalties is a bigger burden. Kaletsky said a “regular inspection” in which no injuries or fatalities occurred could bring fines amounting to a couple thousand dollars.

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